How long is the holding period?

Stock Holding period calculation - india?

• I would like to confirm holding period whether it is long term or short term in the following, Mary invests in XYZ stock on January 3, 2007. She sells the stock on January 3, 2008. Mary's holding period for the stock is exactly one year. I guess,it is short term? thanks

• Answer:

  Yes you are correct. Short term is defined as 1 year or less and long term as over 1 year. A Wall Street Journal and other articles say that if you buy a stock on January 3, the holding period does not start until January 4 and ends on January 3 of the following year. However, on my tax return I would count it as a long-term gain for the following reasons. The calendar year starts at January 1 and ends on December 31 of the same year. So January 1 of the following year is already the beginning of the 2nd year. The same is true of a a fiscal year. If it starts on July 1, then it ends on June 30 of the next year. I hope I don't have you thoroughly confused now, but I am just giving you my reasoning. However, according to rules adapted by the Indian government in 2008, long term is defined as 1 year or more, so my rules would apply. http://taxes.about.com/od/capitalgains/a/CapitalGainsTax_2.htm http://www.smartmoney.com/taxes/income/tallying-your-capital-gains-and-losses-9868/?zone=intromessage http://en.wikipedia.org/wiki/Capital_gains_tax